Web3 may be the buzzword of 2022 but the idea to create a decentralized platform that hosts decentralized applications is a long-held vision of the crypto community. It’s interesting that Web3 was first developed by some blockchain companies four to five years ago. However, Web3 has only recently gained traction.
Electric Capital, a venture capital company that has invested in Web3 companies since 2018, highlighted the recent growth of Web3. “Electric Capital 2021 Developer Report” examined data from almost 500,000 code repositories, 160 million code commits across Web3, and found that more than 34,000 developers contributed code to Web3 projects in 2021 – the largest number of developers ever recorded.
The report also pointed out that Web3 was the first project started by 65% of active developers last year and 45% of full time developers. It was also revealed that more than 18,000 active developers contribute code every month to open-source crypto projects and Web3 projects, mainly based on Ethereum.
Web2 developers flood the Web3 market
Cointelegraph was told by Maria Shen, Electric Capital’s partner, that 2021 saw historic growth in Web3 development. It brought in the largest number of active developers monthly the crypto industry has ever seen. She explained that this number is only for open-source developers.
Web3 is open-source, even though there are many closed-source crypto developers. This is the key difference between Web3 and Web2. Web2 is a private development environment where everyone works privately before shipping the final product. Web3 developers ship and build in the open.
Shen noted that Web2 developers are migrating to the Web3 world in an increasing number. This is partly due to the flexibility of Web3’s entry point.
Shen explained, for example, that part-time Web3 developers can easily enter and work on Web3 projects. Web2 is a place where you can either work for Google or not. There is no in-between. Web3 is open to hobbyists,” she explained. Shen said that Web3 is more open than other spaces, and allows developers to work full-time, part time, or on occasion. She stated:
“Full-time developers can commit to 10 or more days per month to a project while a part time developer might only work weekends and nights. Web3 allows for this unique opportunity, and we are seeing Web2 developers coming in.
Web2 developers are also interested in Web3 because of its mainstream adoption. Shen noted that the rise in nonfungible tokens has led to a new generation of developers who are focused more on art, design, and supporting creators. Cointelegraph’s Tegan Kline, cofounder of Edge and Node, the open-source development team behind The Graph, shared this sentiment. Shen said that decentralized finance and NFTs have made it easier for developers to get into Web3. She said that traditional companies can now easily enter Web3 because of NFTs.
Kline stated that The Graph had seen a 30% increase in developer growth year-over-year. He also noted that Edge and Node have recently hired engineers from Google and Amazon Web Services, as well as individuals from traditional financial institutions. Kline stated that the mass exodus to Web3 has begun and that he believes we will see more tech companies enter the space.
Web3 developers are getting better solutions.
It’s important that developers are able to create products for Web3 ecosystems, with a much more flexible entry point and mainstream adoption.
Web3 is a great tool for integrating data from central points into decentralized protocols.
Heikki vanttinen, cofounder of blockchain oracle API3, explained to Cointelegraph that API3 is aiming to bring off-chain data sources (such as real-world weather data) to large-scale blockchain networks. He explained that the API economy is being brought to the blockchain to allow decentralized applications and smart contract to operate based on real-world events and data. Vanttinen explained how the “Beacon”, oracle features, are constantly updated data feeds powered by one first-party Oracle. This makes it easier to use API3’s technology in Web3 projects.
Vanttinen also mentioned that Beacons eliminate third-party oracles like Chainlink. Beacons eliminate the need for a third-party entity between smart contracts on-chain. Instead, Beacons allow APIs to directly connect to smart contracts instead of having to have a middleman oraclize data source off-chain.
Shawn Douglass is the CEO of Amberdata, a digital asset provider. He told Cointelegraph Amberdata uses API3’s Beacons for its APIs to be offered on-chain as first-party oracles. He noted that this is a safer and more cost-efficient solution than other solutions that use middlemen.
Douglass explained that Ameberdata Beacons would be used at ETHDenver 2022’s “Buidlathon” where more than 3,000 Web3 developers can create their own API3-powered data streams. Douglass said that he was curious to see the use cases, but that Beacons do not help developers build faster. He explained that the solution was more about enabling developers build with data directly, from trusted data providers, and not relying on third-party Oracles.
Web3 developers face another challenge today: integrating new products into crypto-wallets. Cointelegraph spoke with Erik Marks, an engineer from MetaMask, a software wallet for Ethereum blockchain. He said that integration with wallets is often the best and most efficient way to increase a product’s use in Web3.
This is particularly true for people who are creating completely new things, such as networks and protocols, exotic assets or scaling solutions. An application can only maintain and build a limited number of features, so some integrations will be de-prioritized.
Marks explained that MetaMask recently released Snaps, a new feature that allows developers to build Web3 applications. Marks also said that Snaps was released via MetaMask Flask which is the company’s distributor channel for developers.
Marks explains that Snaps was created to enable developers to extend the functionality of MetaMask’s runtime functions without the involvement of the organization.
Developers can create their own features and make them accessible to users. Every wallet developer knows that it is difficult enough to provide first-class support for Ethereum and its layer-2 networks, let alone the new layer-1 networks. To keep up, invite the Web3 developers community to the wallet and let anyone expand its capabilities without any involvement from us.
Jacobc.eth from MetaMask’s operations team told Cointelegraph that once Snaps matures, MetaMask will no longer need to ask MetaMask for support for hardware wallets, layer-2 network or new asset types. He said, “You will just create a Snap and then inform your users about it.”
Web3 developers will continue growing over time
Industry experts predict that the Web3 developer market will continue to grow due to the Web3 ecosystem’s maturing. Shen believes this is true based on the past history of the crypto market. She said that crypto prices peaked during the bull run of 2017-2018, but developers didn’t flood the space until around a year later. “If this market is similar to the last, developers will still be infiltrating the space through 2023,” she said.
Kline also stated that Web3 is becoming mainstream. However, she expects that the sector will be finalized in the next six to twelve months. “We have reached the limits of what can be done in a centralized environment. Web3 allows us to scale further.” Shen said that this is true, but she pointed out that there are still many challenges for Web3 developers. She said that Web2 has a number of tools that developers can use to ship their products quickly, but Web3 doesn’t. Shen stated that Web3’s underlying infrastructure will be a challenge, noting that the space is still lacking much-needed accessibility.
Interoperability, which would allow different ecosystems to interact with each other, is one example. Co-founder and CEO Maly Ly of the Laconic Network, a blockchain project that aggregates data in Web3, told Cointelegraph that different Blockchains must be able communicate with one another to facilitate interoperability.
Ly stated that cross-chain communication is a necessity, and has resulted in the rise of bridges. These require quicker and more flexible access, or proofs, to verifiable, blockchain data. Ly is optimistic that there will be many solutions to these problems this year.
Web3’s promise is aligned to network, builder, and user incentives. Web3 relies on trustless systems that ensure data availability and verifiability. These fundamental data verification and querying problems will be solved to address core decentralized app development and adoption issues.
Eileen Wilson –Technology and Energy
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